How Long Does A Bad Credit Rating Last?

A bad credit score can be incredibly damaging to you. If you happen to suffer from bad credit, then you’ll find it difficult to obtain new credit. A bad credit rating will be indicated in your credit report which contains comprehensive information about your credit history.

Positive credit reporting has been introduced into Australia gradually, and will be legally required from 1 July 2018. This means that as well as showing serious defaults and bankruptcy, your credit report will also include positive information about when you make loan repayments on time.

When you suffer from poor credit, it is obvious that you’re wondering how long does a bad credit score last. Before we take a look at this, you need to understand your credit report in a little more detail. We’ll also take a look at whether all types of credit infringements are treated in the same manner.

How do I get a bad credit score?

You receive a hit on your credit rating every time a creditor lists a default against your name. These defaults may include anything from unpaid bills to outstanding debts. The most common types of defaults include loan and mortgage repayments, utility and telco bills and credit card payments.

To strike a default, creditors must provide you ample opportunity to settle your dues. However, if you fail or refuse to make payments even after being contacted and being provided with the opportunity to settle your dues, you will receive a default.

How long do defaults last in my credit history?

To answer this question, you must understand that different types of defaults are treated differently in your credit history. For instance, a minor default of credit card payments will last on your credit history for five years. However, a major default will last seven years or longer.

In general, most types of defaults will last in your credit history for five years. However, court writs last for four years while clearouts last for seven years. A clearout happens if you owe a creditor, but you’ve changed your contact address without providing the creditor with your new address. It is considered to be a serious consumer credit infringement in Australia.

In case you make payments for past defaults, they will still be listed on your credit history. However, they will be listed as paid, and your credit score will also reflect that.

Can defaults be erased from my credit history?

Defaults will be erased from your credit history only after five or seven years as the case may be. However, if you find that a default erroneously listed in your credit report, you can contact your credit reporting agency to get it erased. If your case is found to be genuine, the default will be erased from your credit report.

How can I avoid defaults in my credit report?

There are a number of things you can do to avoid defaults in your credit report. Make sure to pay all your bills on time. Scheduling your bills around your pay cycle will help you meet all payment due dates.

Make sure to keep track of all credit commitments you’ve made in the past. In case you change your address or phone number, make sure to notify your credit providers.

How can I improve my credit score?

To improve your credit score, you must demonstrate that you are financially responsible. Do not miss any payment due dates and don’t access credit unnecessarily. Keep track of all credit commitments you’ve made in the past and try refinancing or consolidating your debt.

Also, obtain a copy of your credit report and review it for errors. Removing errors from your credit report will help your credit score improve.

In case you are struggling to meet repayments, talk to your credit provider. In many cases, credit providers will be willing to consider your situation before striking a default against your name.

If you’re looking to apply for new credit or a loan, you should seek the help of professional finance brokers such as Loans for People with Bad Credit. Our expert brokers will assist you with everything – from obtaining your credit report to reviewing it for errors, preparing loan documents and presenting the right application to lenders. We’re bad credit rating loan specialists, and we can help you even if you suffer from a bad credit score.

How do I obtain my credit report?

You can obtain your credit report for free once a year. Simply place a request with your credit reporting agency, and you’ll receive your report within ten days. However, if you need more than one copy of your report during a year, you will be required to pay.

You can also seek the help of professional finance brokers to obtain your credit report. Reputable finance brokers such as Loans for People with Bad Credit can help you obtain your credit report for free without any hassles.

Apply for your free credit report today!

If you’re wondering how long a bad credit score lasts, then you should obtain your free credit report. Your credit report is an indication of your credit history, and it will contain information related to any defaults you’ve made in the past. Most types of defaults will remain in your credit report for five years. However, serious credit infringements will remain in your credit report for seven years. Even if you make payments for your defaults, they will remain in your credit report but will be indicated as paid.

To obtain your free credit report, get in touch with your credit reporting agency. Alternatively, you can seek our help here at Loans for People with Bad Credit. Not only will we help you obtain your free credit report, but we can also help you obtain new financing for your needs.

We’re not just brokers – we’re bad credit rating finance specialists. Whether you’re looking for car financing or home financing with a bad credit score, you can count on us to help!

Angela Monroe is the Community Manager at The Positive Group, specialising in giving people the information that they need when they need it, and putting you on the path to a fair financial future. She has 8 years of experience in helping Australians find the right finance solutions, and regularly contributes articles to empower Australians with the knowledge they need to become financially healthy.